On December 31, 2015 it was determined that ending inventory on hand was $200,000. Accounts Receivable ending balance was 50,000. For the year 2015 - Beginning inventory was 100,000. Purchases of inventory totaled $300,000. Sales totaled $400,000. For year-ending 2015: It was determined that replacement cost of inventory was 190,000. And the net realizable value of Accounts receivable was 45,000. Prepare 2015 income statement for the limited facts given. Tax rate is 40%. Credit sales were made in the amount of $400,000. Cash sales were made in the amount of $200,000 Bad debt rate is 5%. Company uses percent of sale method. Book entry to recognize bad debts. Company has an unadjusted debit balance in allowance for doubtful accounts of $10,000. The company also has an unadjusted balance in A/R for 100,000; from a year-end analysis to impact balances the company determines it is going to write off 5,000. It then determines that 20% of the remaining balance is "current" with a 1% likely uncollectible rate. 50% of the balance is is non-current with a 10% likely uncollectible rate. The remaining balance is past-due with a likely 20% uncollectible rate. The company uses the aging method. What is the entry to recognize bad debts? What is the amount shown on the balance sheet